Computer-implemented methods and systems for trading articles such as stocks, foreign exchanges, cereals, ores, futures, and the like are well-known in the industry. In a conventional method and system, an investor inputs into a computer desired purchase (or selling) price and desired purchase (or selling) quantity of certain articles, securities, foreign exchanges or indexes to generate a trade order and to conclude a trade.
It has been a general practice for a stockholder to directly order a stock transaction at a brokerage company or to commission an employee at a brokerage company to order such a stock transaction under the employee's own discretion. Conventionally, when a stockholder intends to order a sale or purchase of a stock, he or she contacts a brokerage company either in person, by telephone, by personal computer through a communication network system, or via the Internet. When a staff member at the brokerage company is commissioned to make the transactions, stock trading is performed based on the trader's relationship with the broker and the trader must rely on the broker's decisions.
A method for dealing in stocks at a stock exchange market (“SEM”) as well as some of the terminologies used in relation to stock dealing will now be described briefly using the New York Stock Exchange (“NYSE”) and the Korean Stock Exchange (“KSE”) as examples. The “closing price” is the trading price of a particular share at the close of trading at the stock market. The “opening price” is price of the particular share at the beginning of trading, which is also the same as the previous trading day's closing price. The term “high price” refers to the highest price at which a particular stock traded during the day, while “low price” refers to the lowest transacted price of the day. Share trading at the NYSE is permitted from 9:30 am to 4:00 pm Eastern Standard Time (“EST”). After-hour orders for stock dealing can also be placed from 4:00 pm, after market closing, until 9:30 am EST the following day. Trading orders may be placed in any of the previously-described manners.
In the KSE, as of February 1999, a stock price is based on a closing price of a previous day and can rise or fall within a range of 15% of the previous day's closing price. The KSE opens at 9 am during workdays except for holidays, weekend and yearend, and closes at 3 pm. A “daily upper limit” in the stock dealing means a price 15% above the closing price of the previous day, and a “daily lower limit” means a price 15% below the closing price of the previous day. Purchases and sales of stock can be made from 9 am, when the stock market opens, until 3 pm, when it closes, but orders for stock dealing can be reserved even after the market is closed from 5 pm until 9 am the following day when communication by computer, ARS, Internet, or the like are utilized.
FIG. 1 is a schematic diagram illustrating a conventional system for facilitating the buying and selling of stocks. Referring to FIG. 1, a conventional method of buying and selling stocks proceeds with a user placing a trade order utilizing the communication between a computer and the stock market, such as over the Internet. More particularly, a stockholder's (user's) computer system 10 is connected to a computer system 20 of a brokerage company via a data communications network 40 (such as the Internet). The stockholder deals with the brokerage company to confirm trade information such as an account balance, residual quantity of stocks, present price, or closing price of his desired stock. When the stockholder orders the sale or purchase of a particular stock, the transaction is entered into the computer system 20 of the brokerage company. The transaction is then transferred to a computer system 30 of the SEM after being processed by the brokerage company. When the trade order is received at the SEM computer system 30 via the network 40 from the brokerage company, the SEM computer system 30 matches a selling order price and quantity with a buying order price and quantity and allows the trade to be concluded at that particular price.
Generally, this kind of buying and selling is repeated on a minute-by-minute, transaction-by transaction basis during the open trading period of the market. A similar method is performed when the stockholder visits the brokerage company, except that the stockholder's personal computer system 10 need not be used to input the trade order information. In order to transact these orders, whether they are purchase or sale orders, certain information is required. For instance, an item code of the stock to be bought or sold, the desired purchasing or selling price, the desired purchasing or selling quantity, and similar information should be input by the stockholder or authorized broker at the brokerage company via a computer or ARS.
Stock investors may frequently consider future transaction conditions under which they intend to invest, including desired purchase price and purchase quantity, and desired selling price and selling quantity of a particular stock. Unfortunately, however, in order to determine whether the current price of the stock has reached a desired purchase or selling price, they must be constantly aware of stock price changes at the stock market. Therefore, in order to be successful in stock investment under the conventional stock dealing method described above, continuously changing market conditions must be carefully monitored and acted upon quickly.
Conventionally, however, it has been difficult to constantly observe the changing stock prices. In addition, fundamental basic information data (e.g., stock account number, account password, etc.) and buying/selling condition information data (e.g., stock item code, desired buying/selling prices, desired buying/selling quantity, etc.) generally needs to be input via the computer system 20 at the broker's office by the stockholder or broker at every dealing point in time. Accordingly, in order to place a trading order corresponding to a desired purchase or sale condition, market information needed to be continuously monitored by the broker or trader, and the trading order needed to then be timely placed when the market information matched the desired purchase or sale condition.
Accordingly, a significant disadvantage of conventional trading methods is that much of the stockholder's and/or broker's time is consumed watching the market information and initiating trading orders. In addition, investors who are unable to timely contact their brokers and/or fully communicate their trading preferences to the brokerage find it difficult to properly supervise and direct their portfolios.
Another significant problem is that the brokerage company staff must expend inordinate amounts of time placing each and every buy and/or sell order. Furthermore, if there is an input error when entering necessary information data—such as may be due to erroneous typing or other mistake—the brokerage company faces potential liability for the amount of the investor's economic loss.